HSBC says pre-tax profit fell to $3.1 billion in Q3

HSBC on Tuesday said pre-tax profit slipped in the third quarter of this year, with the bank citing an impairment on the planned disposal of its retail banking operations in France.

The Asia-focused lending giant said pre-tax profit fell by $2.3 billion to $3.1 billion while reported revenue dipped three percent to $11.6 billion.

In a statement to the Hong Kong stock exchange, HSBC said it was looking to sell its French retail arm “as part of our actions to simplify our operations in continental Europe”.

“Upon classification to held for sale, we recognised an impairment of $2.4 billion,” the bank added, saying it hoped the sale would go through in the second half of 2023.

The statement added the bank was also “exploring the potential sale” of its Canadian division.

The earnings report also detailed the tough global economic climate international banks are facing.

“Macroeconomic headwinds, including higher inflation and a weaker outlook, continue to weigh on the global economy,” the statement said.

HSBC specifically cited global uncertainty sparked by Russia’s invasion of Ukraine, the fall of the pound in Britain and the grim condition of China’s real estate sector.

But chief executive Noel Quinn said the bank was focused on delivering a returns target of at least 12 percent for next year as well as keeping costs down.

“We retained a tight grip on costs, despite inflationary pressures, and remain on track to achieve our cost targets for 2022 and 2023,” he said in the earnings report.

jta/dan